Trump’s hints at ‘flexibility’ on reciprocal tariffs cheers markets

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Financial markets have made an optimistic start on Monday with U.S. stock futures rising and the dollar firm, Reuters reports.

S&P 500 futures are up about 0.7% in the Asia session and Nasdaq 100 futures have risen by 1%.

US stock indexes are poised for a positive opening amid optimism about the possibility of de-escalating trade tensions between the United States and China and moving toward negotiations. This could reduce the risk of a broader trade war after the two economic powers’ mutual escalation, which has caused uncertainty in the markets.

Republican Representative Steve Daines, a pro-Trump Republican, visited China and met with Premier Li Qiang on Sunday. This visit marks the first visit by a US political figure to China since Trump took office earlier this year. It also represents an important step that paves the way for the next meeting between the Chinese and US presidents, according to Daines.

“I don’t change. But the word flexibility is an important word. Sometimes it’s flexibility. So there’ll be flexibility, but basically it’s reciprocal.”

US and European equity futures are pointing to a stronger open as traders react to news that reciprocal tariffs will not be implemented all at once. The tariffs for April 2^nd are now likely to be less sprawling and not a fully global event. They are also expected to exclude sector-specific tariffs on autos, pharma, and chip makers, which may spur some relief rallies later on Monday.

But is a delay to tariff announcements merely kicking the can down the road, rather than a softening in Trump’s approach to tariffs? There have been comments from officials this weekend, which suggests that tariffs will not be as bad as some expect, and they will only target countries that run large trade surpluses with the US.